Probabilities for decision analysis in agriculture and rural resource economics: The need for a paradigm change

The notion that we can rationalize risky choice in terms of expected utility appears to be widely if not universally accepted in the agricultural and resource economics profession. While there have been many attempts to assess the risk preferences of farmers, there are few studies of their beliefs about uncertain events encoded as probabilities. We may attribute this neglect to scepticism in the profession about the concept of subjective probability. The general unwillingness to embrace this theory and its associated methods has all too often caused researchers to focus on problems for which frequency data are available, rather than on problems that are more important where data are generally sparse or lacking. In response, we provide a brief reminder of the merits of the subjectivist approach and extract some priorities for future research should there be a change of heart among at least some of the profession.